India Gold Imports Double as Festive Demand Returns

India's gold market is recovering as the country enters its festive and wedding season. Gold imports more than doubled in July to an estimated 40-45 tonnes, driving the import bill to $4.16 billion. This rebound follows a price correction in June, prompting jewellers to replenish inventories and consumers to return to the market despite domestic prices exceeding ₹1.5 lakh per 10 grams.

World Gold Council analysts note that while high prices have reduced the physical volume of jewellery purchased, overall spending has increased. Consumers are shifting toward lightweight pieces and increasingly exchanging old gold for new jewellery. Investment demand also remains a primary driver, with gold exchange-traded funds recording net inflows of ₹1,560 crore in July and ₹1,179 crore in early August. Trading activity on the Multi Commodity Exchange of India similarly improved, with average daily volumes reaching 14.9 tonnes in July.

The World Gold Council attributes the broader price rally to a weaker US dollar, geopolitical uncertainty, and shifting expectations regarding US monetary policy.